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The 20 Steps Model

Examples of Use
Case Studies
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Route to Market Strategy (or Trade Marketing & Distribution
Strategy, or Sales Execution Strategy or whatever name is
used), provides a roadmap to get your products, from your
factory, plant or warehouse to your customers, distributors
and/or end-users, in the most efficient and effective
manner, with the aim of growing sales while satisfying
customers.
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The 20 Steps to Route to Market Excellence model is a
methodology or framework to allow FMCG leaders, to
review, transform or build their RtM capability in a
structured manner, covering all elements of the RtM
strategy.
The 20 Steps are split into 4 phases, Assessment,
Strategy, Design and Implementation.
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Levels & Application 07
RtM Strategy can be looked at, developed, reviewed or built
at different levels which is up to the individual.
RtM Strategy can be at
the market cluster level
the country level
the city, town or territory level
Regardless, the base principals are the same.
The Steps & Phases are less important than the CONTENT
The goal of the methodology is to make sure we cover all
areas.
Phase 1 - Assessment 08
Review and understand every element of your current RtM set up
Review your ‘current’ 20 steps across your RtM– what ever is present
In the absence of ‘hard facts’ – we use best commercial estimates
Include the performance of current and available distributors, field force, back
office, sales management, operations, CRM, etc.
Review RtM operations of competitors & best in class non-competing
companies
 Phase 1 - Assessment
Approach
Review Current RtM Performance – Strategy, the Existing
20 Steps that are present, SWOT, Work Practices, Metrics,
1 Portfolio Analysis (Pricing & SKU Segmentation) & effect
on RtM, advanced RtM Data Analytics, etc.
Consumer & Market Mapping – Consumer Behaviour &
2 Trends, Specify Geographic Realities, Trade Landscape,
Point of Sale (Direct/Indirect), Key Battlegrounds, Must
Wins.
3
Distributor Assessment (Direct/Indirect/3rd Parties) – Visit
3 Client Distributors, Access Current Distributors
Competitor Analysis – Competitive, Non-Competitive, Best
4 in Class
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Deliverables
Current RtM performance – A-Z of Current
Performance covering the 20 steps.
Portfolio & Pricing Analysis – Overview of Brand
Portfolio, Price, Portfolio & SKU Segmentation,
Pricing Strategy & Execution
Distributor Performance Assessment (Quantitative
& Qualitative) vs Best in Class
Competitors – Model of Competitor RtM,
Competitor Portfolio and Best in Class RtM Models
Market Map – Current Consumer Behaviour &
Geographic Nuances, Outlets by Channel and
Coverage Map (Direct & Indirect)
Phase 2 - Strategy 10
Based on the extensive review in Steps 1 to 4
Mapped the entire marketplace, the total number of POS
Understand customer trends & needs, detailed reality of our marketplace,
Assessed current/potential distribution models, analysed the competition.
Looking strategically across the 20 steps
Working closely with your cross functional and interdepartmental teams
Map out your customised RtM Strategy and approach to deliver your strategic
goals.
Phase 2 - Strategy 11
Approach Deliverables
RtM Strategy & the 4D Approach
5 Overall Approach to RtM linked to commercial goals
4D RtM Strategy & Approach
Detail what success looks like
Define the DIME Approach (Direct, Indirect, Mix &
Everything in between) – See example later RtM Strategy Map – Highlighting Key
Define requirements across 4D’s (Distribution, Dependencies of RtM Strategy Components.
Display, Dialogue, Digital)
Link them to the organisation goals
Strategy Map to Define Dependencies & Ensure Define DIME Approach
Organisation Buy-in 3
Phase 3 - Design 12
Phase 3 focus is to design the specific steps that deliver the RtM strategy
This includes classifying each point of sale/outlet against chosen criteria
Segmenting these into channels, building sales territories, designing RtM structure
The right data and metrics, Sales Incentive Programme to support RtM goals
Sales force need to be equipped with the required toolkit
A Trade Incentive Programme to partner with your customers
All supported by the right technology & Digital RtM integration
Phase 3 - Design
Approach Deliverables
6 Outlet Classification - Levels, Criteria, Resource
Channel Classification - Review, Prioritise, Define
7 Channels, Sub-channels, Management & Resource
Territory Planning – Geography, Link to Market
8 Mapping, Trade Coverage, FTE
RtM Structure – Define Field Force & Back Office –
9 Distribution, Merchandising, Promotions, Telemarketing,
Customer Services, Events, Trade Marketing, HoReCa, etc.
3
Data & Metrics – Define Current Capability, New Data
10 Requirements, Revenue Management Model, KPIs, Reporting, etc.
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Outlets – Customer Outlets Classified
Channels – Channel & Sub Channel
Management Plan.
Territories – New Territories, Resource Plan,
Route Plans, Target Calls & Frequency
Structure – Defined Field Force – Type,
Numbers, Structure. Cost to Serve Model
Data & Metrics –Roadmap including
Requirements, Capture & Systems, New KPIs,
Defined Qualitative & Quantitative Reporting
Phase 3 - Design 14
Approach Deliverables
Sales Incentive Programme (SIP) – Successes, New SIP – New Sales Incentive Programme &
11 Targets including Volume, Brand Distribution, Point of Training Plan
Sales, Visits, etc.
Trade Tool Kit – Outlet Execution & Activation, Define Must Trade Tool Kit – New Trade Tool Kit, Tool
Haves, e.g. Order Capture, Order Method, POS Material Kit Processes, Agreed Approach & Training
12 Placement & Management, Planograms, Portfolio and Plan
Pricing Process & Initiatives, Trade Incentives &
Promotions, Trade Engagement Options, etc.
TIPs – New Trade Incentive Programme &
Trade Incentive Programme (TIPs) – Review Successes, Training Plan
13 Develop Options
3
Technology –RtM Digital Integration Roadmap, Define Technology – Digital RtM Roadmap & Plan
14 Technology Requirements for CRM, Hand Helds, Order
Capture, Trade Marketing, Trade Data capture, Trade
Census Management, Track customer compliance to terms,
Planogram Compliance, RtM Data Analytics, etc.
Phase 4 - Implementation 15
Phase 4 focus is on implementation. Depending on the strategy chosen either
pilot,
scenario plan or
implement the new approach with your teams.
This includes implementing the Distributor Partnership Programme
Effective Third Degree Partnerships (3DPs) Researched & Implimented
A Key Account Management (KAM) Department & Approach
A programme of Training & Upgrading, Functional Integration with all departments
Supportive Culture & Leadership, Ensuring Continuous Improvement
Phase 4 - Implementation 16
Approach Deliverables
Distributor Partnership Programme – Develop Model Distributors – Define & Agreed Model,
15 Distributor, Strategy, Approach, Development Plan & Development Plans, New Contracts & SLAs,
Execution for each Distributor New Performance System, Transition Plans

3DPs – Defined Partnerships, Negotiation

Third Degree Partnerships (3DPs) – based on current
16 Distributor needs & issues, identify 3DPs and implement
Plan, & Programme Rollout
program
KAM Programme – Defined KAM Approach,
Rules of Engagement, Negotiation Strategy
Key Account Management (KAM) – Define KAM Needs, & Rules
17 Relationship Management & Negotiation, Trading terms
Phase 4 - Implementation 17
Approach Deliverables
Training & Upgrading – Rollout Training across all steps. Training – Programme, Workshops, Train-
18 Include ‘Steps of the Call’, ongoing Training Programme. the-Trainer, On-The-Job Coaching
Roll out New RtM Development (NRD) approach to ensure New RtM Development (NRD) - The
Continuous Improvement Continuous Improvement Programme
Functional Integration – Map Out & Execute RtM links to (Covering 20 Steps), How to Capture &
other Functions, especially Marketing (Portfolio, Pricing, Spread Success
19 SKUs, POS) & Supply Chain (Sales Forecasting/Inventory
Functional Integration – New Functional
Management/Out of Stocks Prevention). Also include
Interfaces Embedded, Sales & Operational
Finance, Operations, IT & HR. Integrate new RtM with S&OP
Planning (S&OP) and RtM Integrated
Culture & Leadership – Develop & Execute Supporting Culture & Leadership – Change
20 Change Management Plan. Develop & Execute Clear 3 Management Plan, Workshops to Support
Messaging. Develop Cross-Functional Buy-In & Support Plan
NEXT STEP Continuous Improvement –Monitor 20 Steps Continuous Improvement – Follow Up Plan
effectiveness, review the approach and ensure continuous to ensure sustainability and continuous
improvement improvement
Flexibility 18
The 20 Steps model provides great flexibility.
Depending on your specific need
You may need a full Route to Market Transformation
Covering all 20 Steps, or
You may require a focused interaction (e.g. on
Distribution)
You must identify those needs & tailor any program.
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Step 3 - Distributor Assessment 20
Distributor or Distribution Assessment is Step 3 the model. It consists of:
Macro - what is available in the market and,
Micro - the current or potential performance of each option.
Some key advice here is not to assess one without assessing the other.
Best practice is to complete Macro first and then Micro.
To do this, we use our DIME Approach (Direct, Indirect, Mix & Everything in
between).
Direct Distribution is where you distribute your own products and explicitly
control each element of the distribution network. In assessing direct
distribution options, you need to evaluate all the potential direct options in
the marketplace, rank them based on a specific criteria, and then perform
detailed assessments on the top ranked options.
Step 3 - Distributor Assessment 21
Indirect Distribution is where you utilise you own customers to pass your products
through the supply chain. This can take many forms but is usually FMCG company
to distributor(s), potentially on to wholesalers, cash and carry’s, and then on to outlet
level, including retail and Horeca. In assessing indirect distribution you need to:
Firstly, map out all of the potential first line distributors, including their national
or regional coverage map then,
Rank them based on specific criteria,
Finally, perform detailed assessments on the top ranked options.
Feel free to gain inspiration from our Distributor Assessment Guide and
Distributor Assessment Tool available for download.
Mix is where we use a combination of direct and indirect distribution. For example,
you may directly distribute to the top 4 cities in your market as they account for 60%
of the volume and you may use distributors for the rest of the market. In assessing
mixed distribution, you need to map the potential options for each mix element, rank
them based on set criteria, and then perform more detailed assessments on the top
options.
Step 3 - Distributor Assessment 22
Everything in between is essentially a stand back, stop and pause moment. This is
where so-called blue-sky, left-field, total market disruption ideas come in. It is where
we try to model the new and emerging trends distribution options to see where they
will fit into the new normal and how we can capitalise and gain competitive
advantage.
We have provided a list of questions you can ask under each DIME element,
designed to kick start the process on how to protect your distribution options in this
new normal.
Step 3 - Distributor Assessment 23
The Process:
Enchange has pioneered a Route to Market programme (RtM) that delivers
maximum distributor performance without the cost ofmaintaining own
direct distribution.
It is particularly suitable for Producers who use a multi-distributor model in
markets with a high degree of ‘traditional’ non key account trade.
Enchange has a suite of RtM tools to measure distributor performance &
distributor compliance to producer standards.
It always delivers a sales uplift (15%+) & improved customer service for
producers.
Step 3 - Distributor Assessment 24
Measure current performance vs international best practice, use Enchange toolset
Visit to Distributor HQ (Discussion/Evaluation with Senior & Ops Management,
Rep Trade visits, etc.)
Analysis of Distributor Data
Assessment of Distributor using Enchange Distributor Assessment Tool
Tools adapted for each client & measure up to 10 categories including:

Strategy Relationship Demand Management

Inventory Management Warehousing Sales & Ops Management

Finance, Plan & Budgeting HR & Organisation

Performance IT/ Information

Performance bands – we generally measure 3 levels of performance
GOLD (LEADING EDGE)
SILVER (INTERMEDIATE)
BRONZE (BASIC)
Step 3 - Distributor Assessment 25
The analysis & distributor categorisation provides invaluable data to target implementation effort
It will identify high potential distributors where a significant sales uplift is achievable
It will also identify High performing distributors where market share protection is critical

As an example, in one region only, if all distributors achieved the

national average market share, the increase in volume would
deliver a bottom line impact of €1.3m.

In this region the priority was Distributor D

(high potential - large territory, low m/s), &
Distributor E

Distributor A (protect high sales & m/s)

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RtM Programme - Multinatinal FMCG 27
Our client had a multi-distributor model with a mix of good & poorly performing distributors. The local
market had experienced decline in the previous 2 years with all major international players present.
An RTM programme established new international
benchmarks for distributor performance & measured all
distributors against the benchmark.
The results identified specific targeted sales-led initiatives
with distributors & drove a distributor development
programme in time for the new high season.

Results
Distribution network optimised with mix of distributor exits,
territory extensions & new distributor contracts.
Bottom line impact > €11m pa.
First season – sales & market share increased at expense of
2 other key players (in declining market)
RtM Programme 2 - Multinatinal FMCG 28
FMCG Multinational
Importation Model
Channel analysis to understand current Cost to
Serve structure versus competition and market
norms.
New distributor options identified.
Negotiations Undertaken

Results - WIP
New channels were mapped for the FMCG Co.
Existing distributor refocussed on single channel
New distributor engaged, terms were negotiated and contracts agreed
Initial Financial Results:
Year 1 Cost to Serve savings of €840,000 p.a. agreed
Year 2 Cost to Serve savingsof an additional €400,000 p.a. identified

FURTHER READING
Read our blog series by Ross Marie on each
step of the 20 Steps Methodology.
Learn more about Enchange and see how
we can help you to transform your Route to
Market.
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If you need any help or guidance, please contact us
and we would be delighted to discuss your issues or
provide you with more information.
www.enchange.com/contact-us
+44 (0)1403 275576
improve@enchange.com